JUL 1,2022 Unknown author

US Payroll Management Using Odoo 15

Payroll Module

One of the complicated processes for company operations in different

countries is compensating and hiring employees. An employee gets
benefits in bonuses, salaries, promotions, and other deductions. Some
essential elements for payroll calculation in the US are earnings,
deductions, gross pay, taxable gross, and an employee's net pay. Most
firms face difficulties with the payroll management of employees, and
it varies from country to country. Various steps are needed to complete
a payroll operation in a specific county. Using an Odoo ERP, users can
easily manage the payroll process quickly. Odoo 15 Payroll module
assists in accurately processing payroll management for your desired
country.

This blog provides an overview of US payroll management with the

assistance of Odoo 15.

Users can manage employees' contracts and salary attachments using

Odoo 15 Payroll module. The salary structure feature in the Payroll
module ensures entering the salary details of an employee with various
rules quickly. Using the Reporting feature, you can analyze the payroll
structure of staff in a firm separately. Now, let's view how to manage
payroll for US employees.  

Basic Elements of Payroll in the US

Payslips provided by a US company for an employee consist of various

heads such as company identification data, worker details, payroll data,
Earnings, and deductions. Company names, addresses, and
identification numbers are included in the company details section. You
can view the full name, professional category, and DNI number in the
workers' data. Earnings are the base salary for a worker in a firm, and it
is classified into two types: taxable earnings and non-taxable earnings,
considered as allowances.

Deductions in US payroll are different types:

Federal tax, pre-tax deductions, post-tax deductions, and State and

local taxes. The Federal Insurance Contributions Act taxes include
social security and medical care taxes. Federal tax is calculated by
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multiplying the tax percentage of social security or medical care with

taxable gross. State and Local taxes vary as per the specific employee
location. Post-tax deductions consist of other benefits provided to an
employee from a firm. Based on these requirements, let's develop a
new payroll structure inside the Odoo 15 Payroll module.

To Generate a Payroll Structure with Odoo 15

For developing a new payroll structure, a user needs to select the

Structures menu in the Configuration tab, and you can view all created
structures. Click on the CREATE icon to develop a new structure, as
indicated in the screenshot below.

Now, let's develop a structure named 'New Structure' for an employee

of the US country in the next window. For creating a salary structure,
we consider the payslip data of an employee provided by a US company.
Next, we can apply each head to the new salary structure window. Add
'New Structure' inside the Structure Name field, Type as an employee,
and choose the Country United States as depicted in the screenshot
below.

Define your wage payment frequency in the Scheduled Pay field and
payroll information records in your account inside the Salary Journal
field. Choose Payslip as a Report, enter Monthly inside the Scheduled
Pay field, and pick up Miscellaneous Operations in Salary Journal. 
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Later, you can apply various rules for your New Structure by clicking on 2/15
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Add a line option below the Salary Rules tab, as portrayed in the
screenshot below.

Firstly, we can add a Basic Salary rule for the New Structure. Add Rule
Name as Basic Salary, Category as Basic, and type a Code. You can add a
Sequence number to arrange the calculation sequence as specified in
the screenshot below.

Now, the user can set a computation method for the Basic Salary rule.
You can select the Amount Type as Python Code. We consume the basic
salary as a wage included in an employee contract. So, Python code will
be the result=contract.wage, as shown in the screenshot below.

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Select the SAVE icon to develop a Basic Salary rule. Next, let's apply
Earnings to other salary rules in New Structure. We know that earnings
are divided into taxable earnings and non-taxable earnings. First, we
can enter the taxable earnings of employees as a rule in the Salary
Structure window. In the new window, add Rule Name as 'Taxable
Earnings,' Category as 'Allowance,' enter a Code 'TE,' and select New
Structure in the Salary Structure field as displayed in the screenshot
below.

After that, we can set the Amount Type as Fixed Amount inside the
Computation section. Later, enter the amount 930 in the Fixed Amount
field and select the SAVE & CLOSE icon, as portrayed in the screenshot
below.

Now, we can create a salary rule for Non-Taxable earnings. In the

Salary rule window, enter Rule Name as Non-taxable Earnings, and add
Allowance as Category. You can also enter the Code as 'NTE' and New
Structure inside the Salary Structure field, as denoted in the screenshot
below. 

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You can choose Fixed Amount as Amount Type and enter 62 in the
Fixed Amount field as specified in the screenshot below.

After saving the data, we can add another rule for Gross pay. In the new
window, apply Gross as Rule Name, Category as Gross, and enter Code
'GROSS' as mentioned in the screenshot below.

Gross pay is calculated by adding basic and allowances. In the US, the
allowances are taxable earnings and non-taxable earnings. So, we can
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add Python Code based on Gross calculation. After selecting the Python
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Code as Amount Type, enter a Python Code as a result =

categories.BASIC + categories.ALW, as depicted in the screenshot
below.

Here, 'categories. ALW' means the sum of taxable earnings and non-
taxable earnings. The shortcode for the allowances category we created
in the Salary rule is ALW. Other salary rules for the US are Federal Tax,
State and Local Tax, Pre-tax deductions, and post-tax deductions. All
these came under the category of deductions. The Federal Taxes are
based on social security tax and medicare tax. Now, let's view each one
separately. In the Salary rule window, add Federal Tax for Social
Security in the Rule Name field and Category as Deduction, as
mentioned in the screenshot below.

Inside the General section, you can set conditions based on python
expression, as denoted in the screenshot below.

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The US federal tax for social security is 6.2%, added inside Python
Condition as in the above screenshot. After saving the details, we can
develop a salary rule for Federal Tax for Medical Care. Apply the
Category as Deduction and enter Code as FTM, as illustrated in the
screenshot below.

Here, set the Python Expression in Condition Based on the field and
apply the rule in the Python Condition field as mentioned in the
screenshot below.

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Federal Tax for Medicare is 1.45% provided to employees in the US. You
need to mention it inside the python code. Now, we can apply State and
Local Taxes inside Rule name and Category as Deductions, as in the
screenshot below.

The State and Local Tax varies as per the city of an employee. Here, we
set the Fixed Amount in the Amount Type field and enter a value as
mentioned in the screenshot below.

Next, we can enter the employee's pre-tax and post-tax deductions

salary rules in the New Structure window. For that, enter Pre-tax
deductions in Rule Name and Deduction as Category. Later, add PTD in
the Code field and choose New Structure inside the Salary Structure
field, as portrayed in the screenshot below.

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You can select the Amount Type as Fixed below the Computation
section. Later, add the Fixed Amount and Quantity as illustrated in the
screenshot below.

In the same way, you can also generate a salary rule for post-tax
deductions. For that, enter Post-tax Deductions inside Rule Name,
Code as PD, choose New Structure in Salary Structure field and
Sequence, as in the screenshot below.

Below the General tab, select Fixed Amount in the Amount Type field
and add the amount $87 in the Fixed Amount field as represented in the
screenshot below. 
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Now, let’s create a salary rule for Taxable Gross in the new window.
Apply Category and Rule Name as Taxable Gross as denoted in the
screenshot below.

The taxable gross is calculated by subtracting the gross amount from

non-taxable earnings and pre-tax deductions. As per these values, we
can apply a python code inside the Computation section, as mentioned
in the screenshot below.

All these created salary rules for an employee in the US are viewable
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inside the Salary Rules tab in the New Structure window, as depicted in 10/15
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the screenshot below.

Choose the SAVE icon after applying all salary rules.

How to Apply Salary Attachments for an Employee?

We can add salary attachments for employees by selecting the Salary

Attachments menu in the Contracts tab of the Odoo Payroll module. In
the Salary Attachment window, add Employee as Mitchell Admin and
Advance salary in the Description field, as displayed in the screenshot
below.

Salary attachment types are three: Child Support, Assignment of

Salary, or Attachment of Salary. After choosing the Child Support as
Type, a Monthly Account field is viewable before you. Enter your
amount in the Monthly Account field and click on the SAVE icon, as
mentioned in the screenshot below.

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We can see that process is running for the employee Mitchell admin.
After a few months, you can also complete the process by clicking on
MARK AS COMPLETED icon as represented in the screenshot below.

In the case of a loan for an employee, you can change the Type to
Attachment of Salary or Assignment of Salary. Add the Description as
Loan, and choose Attachment of Salary inside the Type section. After
selecting the Attachment of Salary, you can add the amount in Monthly
Amount and Total Amount as specified in the screenshot below.

Based on the total amount, the Estimated End Date for a loan to the
employee is viewable before you, as in the screenshot below.

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To Generate a Payslip for Employees with Odoo 15

We can constitute a payslip for Mitchell Admin by selecting the To Pay

menu inside the Payslips tab. In the new Payslip window, add the
Employee name as 'Mitchell Admin' and choose New Structure inside
the Structure field, denoted in the screenshot below.

By selecting the New Structure option, you can view created salary
attachment types and descriptions inside the Other Inputs sections, as
depicted in the screenshot below. 

After selecting computing, computation is based on each amount in the

Salary Computation tab, as illustrated in the screenshot below.

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Select the PRINT icon in Payslips to Pay window for accessing the
payslip of Mitchell Admin.

Hence, a payslip for Mitchell Admin is created. The salary slip of

Mitchell Admin is shown in the screenshot below.

Odoo 15 Payroll module enable users to formulate payslip for

employees in several countries. We can quickly develop various salary
rules and attachments for an individual using the advanced features of
the Odoo 15 Payroll module. Refer to the following blog to know more
about Odoo 15 Payroll Module.

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